US scrap dealers are hereby stimulated (by China)

Shanghai Scrap is withholding comment on Barack Obama’s economic stimulus in favor of compelling anecdotal evidence that – while the US Congress debates how to stimulate anything – the Chinese government is stimulating the US scrap industry.

Here’s the deal:

Late last year, with little notice, China’s State Reserve Bureau announced that – in an effort to stimulate its flagging non-ferrous metals sector - it would fund the acquisition of a large non-ferrous metal stockpile. Soon after, Yunnan Province – home to a thriving non-ferrous industry – announced its own strategic reserve to include 300,000 tons of aluminum, 100,000 tons of tin, 300,000 tons of zinc, 150,000 tons of lead, and 150,000 tons of copper (details on both programs, here).

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Keep in mind that, in the wake of the economic crisis, and the collapse in China’s export manufacturing sector, the non-ferrous metals industry nearly collapsed due to a lack of demand and excess inventories purchased at record prices. As a result, raw material suppliers – including US scrap metal dealers and Australian miners – found that, in the space of two months, their biggest and best customer (China) simply disappeared.

Cut to this afternoon, and lunch with four mid-sized US scrap metal exporters (and one physician). I arrived expecting to hear market doom and gloom (despite a modest recovery in the markets), as well as harsh words for the large number of Chinese scrap buyers who had reneged on contracts during the October market collapse.

How wrong I was. Continue reading

The masks are back?

Compared to the last bird flu scare, China seems to be taking the current, unsettling spate of bird flu fatalities with unlikely aplomb. Consider: in January, there were five Chinese deaths from the feared pathogen; for the whole of 2008, there were only three. Perhaps the relative ambivalence is related to the fact that the pathogen is emerging during Spring Festival, when attentions are elsewhere.

But if China is taking the emergence in stride, others may not be. On Wednesday I spent two hours at Tokyo Narita Airport, a major air hub and transfer point for flights throughout Asia. And, while there, I saw something that I hadn’t seen since the 2003 SARS outbreak: passengers, and air industry employees, wearing surgical masks in hope of warding off airborne pathogens. A couple of notable cases: a Northwest Airlines boarding agent was wearing a mask while scanning the tickets of boarding passengers (what a way to greet them); on my flights in and out of Narita, a handful of passengers were wearing masks.

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To be fair, I have absolutely no idea if the masks were related to bird flu, specifically, or were just a protective measure (and not a particularly effective one) to protect against winter colds. Also, the number of people wearing masks on Wednesday – maybe one in fifty – doesn’t come close to the numbers in 2003, when half had them. But I’ve been flying in and out of Narita a few times per year, for years, and I can’t recall another instance of mask wearing since SARS.

[Professional Note: In November 2002, two months before the international media found the SARS story, I visited Guangzhou for the first time, and was struck by the large number of people walking around the city in surgical masks. When I asked the person I was visiting, a source, for the reason, he told me that "Guangzhou has a particularly bad flu this year." I had no reason to think otherwise, and let it go. But ever since, I've been sensitive to mass mask wearing.]

[UPDATE: A friend writes to point out that “[S]urgical masks are just as effective as magic amulaets at stopping viral particles. That’s why Northwest should prohibit its employees from wearing both and scaring the passengers.” An excellent point. And since we’re on the topic of Northwest Airlines, I should probably mention that Wednesday’s edition of Flight 1451 was delayed for just over two hours because the airline couldn’t find a flight crew to pilot it. That, according to the flight attendants who kept the stranded passengers informed during the delay.]

Ain’t No Party Like a Shanghai New Year Party.

I was feeling kind of bad about the lack of updates to Shanghai Scrap during the Chinese New Year period – until I stopped by the Shanghai Daily website and found that the Metro section hadn’t been updated in five days.

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Other sections of the paper – business, world, and national news, for example – have remained current. But, presumably, that’s because those sections are generated by Xinhua in Beijing. So, at a minimum, we must conclude that Shanghai Daily’s entire English-language staff deserted the office for the Chinese New Year. Good for them. Still, can anyone out there think of another city newspaper, anywhere else on the planet, that would totally suspend local news for a several day holiday? I can’t.

TOTALLY UNRELATED, but I’m going to bring it up, anyway. This morning I had my first listen to Bruce Springsteen’s middling new recording (here, at the ‘Scrap, we are otherwise big admirers of the Boss), and no more than twenty seconds into the first track, Outlaw Pete, I said: “Holy smokes, the Boss just ripped off Kiss!” A quick google search revealed that I’m not the only one who thinks so. For further info on this emerging story, and a good laugh, see here.

ALSO UNRELATED, but a nifty piece of reported blogging … Dan at China Law Blog gets the scoop on Obama’s phone call to Hu Jintao in the wake of Tim Geithner’s (dumb) currency manipulation comments.

UNRELATED, BUT EXCELLENT is Rebecca MacKinnon’s outstanding open letter to President Obama in re to US-China relations. It includes this very, very good suggestion:

The U.S. embassy in Beijing should build a Chinese-language website modeled after change.gov, focused not just on U.S.-China relations, but on the range of concerns and interests – from environment, to food safety, to factory safety standards, to education and real estate law — shared by ordinary Chinese and Americans. Some linguistically talented State Department employees should start blogging in Chinese. Open up the comments sections, see how the Chinese blogosphere responds, then respond to them in turn. Translate some of the Chinese conversation into English for Americans to read and react, then translate it back.

The Shanghai Fireworks Index

I’ll admit: my knowledge of Chinese astrology hasn’t advanced much beyond what I learned from Chinese restaurant placemats in Minnesota. This means that, like many of my ilk, I’ve been under the blissful impression that the Year of the Ox might beckon a bull market, or at least an expansion in the number of human beings who can afford a good T-bone. Alas, I was wrong: in the last 12 hours I’ve had two conversations with people knowledgeable about these astrological matters, both of whom informed me that the Ox brings economic struggle (“If you dream of an ox, it’s trouble,” said one. “Because an ox must work very hard. So it’s better to dream of pigs. Pigs get to be lazy.”).

Me, I haven’t been dreaming of pigs or oxen. I’ve been dreaming of fireworks and, specifically, the ones that have been going off outside my window since Monday afternoon (not complaining). In fact, they’ve been going off with as much – if not more – frequency than what I recall from past Chinese New Year celebrations. So, with a spirit of new year optimism, I ventured down to my street and queried two of the local fireworks vendors (both, seasonal) to get a sense of how the 2009 market in celebration explosives is performing.

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The results were compelling! First, both vendors were quick to point out that last year’s sales were unusually poor due to the unprecedented New Year snowstorms. A more proper point of comparison, I was told, was 2007. Now, neither of these fellas are the kinds of guys who keep detailed sales ledgers, but they were both adamant that the volume of fireworks sold this year was comparable to 2007. Meanwhile, wholesale prices are down and street prices are steady, or up 5% – 10%. Both vendors claimed that there was very little resistance to a RMB 2 (US$.29) or RMB 3 (US$.43) increase on what would ordinarily be a RMB 25 (US$3.66) string of several hundred firecrackers. Those tend to be bought by families. But the large boxed rocket tubes (or whatever the heck those large red boxes are in the photo), already quite expensive (in excess of RMB 200, or US$29.00), are holding steady, price-wise – especially because restaurants and hotels are the primary consumers of that kind of fire-power. And they’re being careful.

An important caveat for anyone (like me, briefly) too ready to draw sweeping economic conclusions from this limited market survey. According to one vendor, the strong market in Ox year fireworks is proof that the economy is actually performing poorly: “People want to scare away the bad luck and the rat year.” I’m sure there’s an economics Nobel in there somewhere.

[UPDATE 1/19: China Economic Review also writes on the Fireworks Index (h/t WSJ's China Journal) and comes to entirely different conclusions. Meanwhile, Xinhua reports that fireworks sales were up this year, in Beijing.]

May Your Year Be Ox-like (Updated, with lunch)

Best wishes to my readers on this, the eve before the Year of the Ox. Good fortune, recovering base metal prices, and happiness to All.

A personal note: I’ve spent more than six years in China, and I’ve taken well over 20,000 photos in that time. So one would think that, after so many years and shutter clicks, I would have managed to take at least one photo of an iconic Chinese ox pulling a plow, with which to decorate this post. And, after more than an hour of searching, I just happened across this mis-filed image, taken in 2004, in a Yi minority village located in the hills above Xichang, in Sichuan.

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Posting will be light to non-existent until mid-week … though I might be tempted to update this post with some photos of the epic New Year meal to which I’ve been invited, and – if necessary – commentary on the fireworks (especially if they take out one of my windows – again).

Finally, it wouldn’t be fair to talk about the Year of the Ox, without giving brief mention to The Ox, at his best, here.

[UPDATE] In the course of this blog’s two year history, I’ve long intended to photograph and post all of the dishes served at a Chinese banquet (for the benefit of the 95% of my readers outside of China). For various reasons, I never have … before this afternoon. As a result of the generous hospitality of a good friend, I was invited to a (Sichuan-style) company banquet to mark the Chinese New Year. After the jump, a course by course photo essay on each of the dishes served. Believe me, this was a good one … Continue reading

The (year of the) Ox Arrives in Blue

Just looked out the window and saw the bluest Shanghai sky that I’ve witnessed since … the Olympics?

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Of course, the blue sky Olympics were achieved through a series of stringent regulations that choked off economic activity and – by extension – air pollution. In contrast, this evening’s lovely winter dusk is attributable to the oncoming Spring Festival and the near total cessation of economic activity (and pollution) while China’s migratory labor force enjoys a few weeks at home. At least, that’s how it worked in years past. This year, with the economic crisis already having a crippling impact on China’s export sector, one can’t help but wonder if these blue skies will persist into the spring, and later. It’s a bittersweet trade-off, really: the economic health of China’s migrants, versus the blue skies that they’ll tell you that they used to enjoy back home, before China’s economy achieved its miracle.

For more blue sky photos of Shanghai, and elsewhere in China, take a look at the marvelous set of images taken by flickr user kattebeeletje’s mother in 1984 and 1985 (h/t Shanghaiist).

Further thoughts on blue oxen can be found here.

Requiem for an Open Space: No Face

Back in November, Shanghai received the very sad news that the elegant Face Bar was closing after ten years operating within the grassy Ruijin Hotel compound. Regardless of whether or not you were a denizen of Shanghai’s nightlife, if you were in an expat in Shanghai, more likely than not you visited Face Bar at some point – and most likely, the purpose of your visit was to show off the extraordinary renovation of the building, and its idyllic garden setting, to out-of-town guests. I can’t count the number of times that friends with no interest in Shanghai’s nightlife listed Face as one of their tour stops.

Yesterday morning, a little after dawn, I was in the neighborhood and slipped past construction fences to snap this photo of what remains of a building that many will remember as an idyllic pink glow set in a vast green lawn (you can see it from Fuxing Road, as well, but the view is partially blocked by a wall).

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The building is empty and gutted, but – to my untrained eye (it still has its glass windows) – it appears to be awaiting another renovation, and not demolition (rumors has it that Face will be re-opened, eventually). Still, it’s now surrounded by construction, and it’s hard to believe that it will remain unscathed by the activity around it. And that’s a pity, because Face – and the Shanghai-owned Ruijin Hotel complex that owned the building – was a one-of-a-kind property that can’t be rebuilt later. Likewise, the open spaces that made the complex so special can’t be reclaimed once a building has been erected upon them. Continue reading